Page 19 - MEDIASET ESPAÑA / 2012. Financial Statements, Management and Corporate Governance Report

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FINANCIAL STATEMENTS, MANAGEMENT AND CORPORATE GOVERNANCE REPORT. 2012
The Company values incentive plans through shares at fair value on the date of the concession. Making such an esti-
mate at that date requires making estimates and judgments on the valuation option models and taking into account
the price of the option in the year, the life of the option, the price of the underlying shares, the expected volatility of
the share price, an estimate of dividend payments, and the risk-free interest rate for the life of the option.
Channel increase through access to a multiple digital license
As explained in Note 14, the Supreme Court ruled against the authorization of the fourth channel granted to the
Company on April 3, 2010 (as well as an additional channel acquired by Sociedad General de Televisión Cuatro, S.A.U.
in 2010).The directors and their legal advisors have evaluated this situation, which is discussed in Note 14.
3.APPROPRIATION OF PROFIT
The Directors have proposed the following appropriation of profit, expressed in Thousands of euros, pending approval
by the General Shareholders’ Meeting:
Amount
Proposed appropriation
Profit for the year 64,492
Total 64,492
Appropriation to
Dividends -
Goodwill reserve 14,399
Voluntary reserves 50,093
Total 64,492
Limitations on the distribution of dividends
The Company is obliged to transfer 10% of the profit for the year to a legal reserve until this reserve reaches an
amount at least equal to 20% of share capital. Unless the balance of the reserve exceeds this amount, it cannot be
distributed to shareholders.
Once the legal or the company bylaw requirements have been met, dividends may only be distributed against profit
for the year or against freely distributable reserves if the value of equity is not lower than share capital or would not
be caused to be less than share capital by the distribution of dividends. Accordingly, profit recognized directly in equity
may not be distributed either directly or indirectly.Where losses exist from previous years that reduce the Company’s
equity to below the amount of share capital, profit must be allocated to offset these losses.
Companies are required to set aside a restricted reserve equal to the amount of goodwill shown in assets. An amount
of profit representing at least 5% of goodwill must be earmarked for this purpose. If no profit or insufficient profit is
earned, unrestricted reserves must be used for this purpose.